Sailing in Croatia: Sojourn Tax for Boat Owners to Increase in 2018

Substantially increased sojourn tax for boat owners in Croatia in 2018 caused an international backlash.

On August 4, 2017, the Croatian Government adopted new regulations on sojourn tax in the tourism sector in 2018. The part that provoked most reactions was the sojourn tax paid by boat owners: compared with this year, anyone looking to sail in Croatia next summer is facing new tax prices increased by up to staggering 753%.

The sojourn tax for vessels depends on boat length and the time period to be spent in Croatia, ranging from 8 days to an entire year. In 2018, an owner of a 16-metre yacht who plans to spend a month-long holiday on the Croatian Adriatic will pay a sojourn fee of 2000 kuna (267 euro); up until this point, the fee for the cited boat length and time frame used to be 700 kuna (94 euro), making for an increase of 186%. If that same boat was to be left at berth for an entire year, the fee would rise to 9600 kuna (1280 €), making for a mind-boggling increase of 540% compared with last year’s fee of 1500 kuna (201 €).

As one would expect, people didn’t take this lightly, and there has been a public backlash in the international community. Yacht.de, the leading German media website regarding the nautical sector, published an article titled ‘Explosion of Expenses in Croatia’, introducing readers to the upcoming spike in sojourn tax. The piece concluded Croatia is about to become the most expensive destination for yacht owners, stating that no other country ‘invades yachtsmen’s pockets in such a degree’.

Members of multiple nautical-themed Facebook groups, mainly comprised of Italian users, have been quick to judge the new decision. Some of the commenters stated the price increase will cause them to replace Croatia as their preferred sailing destination to France or Greece; other said they are still planning to return, but are about to spend less money in restaurants in local marinas, as well as in other similar establishments.

No official statement has been released on the reason for such a considerable increase, but unofficial sources say the new regulations are an attempt to decrease the number of vessels in the Adriatic, as their ever-growing number started to present an ecological threat to the marine environment. Tax modifications might also be a nod to the Croatian charter industry, as local charter companies suffered substantially since Croatia entered the European Union in 2013 and became a part of the international charter market, allowing for foreign charter agencies to do business in Croatia. Some people now view the new taxes as an attempt to turn away some of the foreign flags, allowing local agencies to improve their standing on the market.

Italy went through a similar process in 2012, when the government adopted a new tax act that imposed a whopping boat ownership tax most yacht owners refused to be subjected to, turning to other destinations abroad. In Italy’s case, introducing a tax on boat ownership was part of the wider battle against tax evasion that used to make for 18% of the country’s GDP, and the new tax was seen as a means to improve the state budget. Boat owners thus needed to start paying anywhere from 800 euro to 25.000 euro annually, depending on boat length; it’s easy to see why yachtsmen started opting for other destinations. The nautical sector in Italy suffered substantial business loss, with some marinas experiencing a decrease in traffic of up to 50%.

It remains to see how the new taxes will affect the nautical sector in Croatia, and if marinas and anchorages are about to experience a drastic drop in traffic. Until then, here’s a rundown of new taxes in relation to boat length and time period spent in Croatia. All prices all listed in euro, with former tax amounts noted in brackets for comparison, also in euro.

You can find the information on the amounts in kuna here, in Article 5.